Franklin Financial Reports Quarterly Earnings Increase

Franklin Financial Services Corporation, the bank holding company of F&M Trust Company, reported earnings of $1,803,000 for the quarter ended September 30, 2010. This compares to earnings of $1,083,000 for the quarter ended September 30, 2009 and brings net income for the first nine months of 2010 to $5,937,000 compared with $4,822,000 for the same period in 2009, an increase of 23.1 percent.

Diluted earnings per share were $.46 for the quarter and $1.53 for the first nine months of 2010. This compares to $.28 and $1.26 for the same periods in 2009.

“The economic recession continues to stymie growth and have a significant impact on individuals and businesses in South Central Pennsylvania. The low interest rate environment has contributed to tighter net interest margins for most financial institutions, resulting in challenging times for banks as well,” commented William E. Snell Jr., president and CEO. “While our earnings this year compare favorably thus far with last, we must remember that 2009 results were significantly impacted by increased premiums for FDIC deposit insurance including a special FDIC assessment that occurred in the second quarter, as well as increased provision for loan loss expense as a result of higher levels of delinquency in both our consumer and commercial loan portfolios.”

Total assets were $967,588,000 at September 30, 2010, falling by 0.8 percent compared to assets on September 30, 2009. Net loans grew by 3.3 percent over totals a year earlier, while total deposits and repurchase agreements increased by 1.1 percent. The market value of trust assets under management declined 8.5 percent to $477,749,000 at September 30, 2010.

Franklin Financial is the bank holding company for F&M Trust, a locally-owned and operated community bank with twenty-five community offices throughout Franklin, Cumberland, Fulton and Huntingdon Counties in Boiling Springs, Camp Hill, Carlisle, Chambersburg, Greencastle, Hustontown, Marion, McConnellsburg, Mont Alto, Newville, Orbisonia, Shippensburg, St. Thomas, Warfordsburg and Waynesboro. Franklin Financial stock is listed on the over- the-counter market under the symbol FRAF.